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3. Consider a linear city depicted below. The city center is a seaport. There is a subcenter four miles east of the city center, where

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3. Consider a linear city depicted below. The city center is a seaport. There is a subcenter four miles east of the city center, where a cluster of textile manufacturers is located. A highway connects the seaport with the subcenter and continues to the east. A typical family in the city has 2 wage earners: the husband working at the seaport and the wife working for the textile industry at the subcenter. All families live along the Mg and they all consume the same amount of housing no matter Where they live. Housing price adjusts to offset total commuting costs to a family. .-o port, city center subcenter (a) Assume commuting cost is the same in both directions. Draw the housing price curve for this linear city up to a distance _e_f 3_ miles away om the seaport. [4 points] Answer: kb) Draw the housing-price curve under the assumption that inward commuting (to the city center in the morning and away 'om the city center in the evening) is more costly than commuting in the opposite direction. [4 points] Answer: (c) Draw the housingprice curve under the assumption that the commuting cost is higher for the wife (because of her higher opportunity cost) and lower for the husband. [4 points]

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